This paper presents a numerical study of the influence of varying story strength on the seismic performance of multi-story wood-frame shear wall buildings. In the prior FEMA P695 studies of these buildings, the non-simulated collapse limit-state was exceeded primarily in the first story [6]. This observation raised interest in quantifying the influence of varying strength from story to story on seismic response. In this study, four different distributions of strength are used as bounding cases. The Parabolic strength distribution (1) is based upon the ELF method in ASCE 7 and assigns lateral forces to each level based on weight and story height. The Triangular strength distribution (2) is based upon the simplified procedure in ASCE 7 and distributes lateral forces based on the seismic weight at each level. The Constant strength distribution (3) assumes the same shear wall design was used on all levels. The Baseline strength distribution (4) is from actual designs provided in the FEMA P695 wood-frame example and represents the practical implementation of the ELF method for designed shear walls. The FEMA P695 methodology, which quantifies seismic performance via adjusted collapse margin ratios, is employed in this study. The analytical models include P-Delta effects and utilize the 10-parameter CASHEW hysteresis model. Based on the analysis of a subset of index models from the FEMA P695 wood-frame example, it is observed that the Parabolic strength distribution, which facilitates dissipation of energy along the entire height of the building, has larger adjusted collapse margin ratios (lower collapse risk) than other strength distributions studied and reduces occurrence of concentrated inelastic deformations in a single story from the onset of an applied lateral force.